BMC Software, Inc (NASDAQ:BMC) to axe people to recover pretax charges

by Sean Patterson | Wednesday, Apr 10, 2013 | 483 views

Northern, WI 04/10/2013 (usastockreport) –  The only way for companies to deal with rocketing taxes is to wield the cost-cutting axe and employees are the first ones to take the hit. BMC Software, Inc (NASDAQ:BMC) (Closed: $44.34, down by 0.25%) develops and manages software for corporate computer networks and has reviewed its operations. The resultant pretax charges lie in the range of $33 million-$38 million has made the company take the decision of downsizing its workforce. All costs that are relegated to termination and severance will feature in the quarter that ended in March and in the current one, said the company in its regulatory filing. There was no mention of the exact number of jobs that would be affected though.

Far-reaching effects

BMC said that the job-cuts will take place across geographies and will affect different corporate functions and business units. The filings indicate that as of 31 March 2012, the company had 6,900 full-time employees. In a separate filing, Elliott Associates LP the activist investor said that the standstill agreement that they had with BMC came to an end on April 6. They said that the firm holds all rights to continue talks with the company. Elliot holds a 9.6 percent stake in BMC and is the company’s second-largest shareholder. Last year, BMC had faced a large amount of pressure from Elliot to consider putting the company up for sale and had also added two directors chosen by him, to its board.

Buy out interest

Last month people in the know had said that some private-equity funds have shown an interest in buying-out the company. The primary reason for this interest had been that Elliott’s standstill agreement was nearing expiration. BMC Software, Inc (NASDAQ:BMC) sells software to corporates who use it in their IT functions. The software helps the departments function in a more efficient manner. Managing the mainframe and server fleets, applying updates to older computers and configuration of newly installed machines are the functions that are benefited by the software that BMC Software provides.

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